Managing for Dummies by Bob Nelson & Peter Economy

Author:Bob Nelson & Peter Economy [Nelson, Bob & Economy, Peter]
Language: eng
Format: epub
Tags: Business & Economics, Leadership
ISBN: 9780470618134
Google: --1i-W-KJHMC
Amazon: 0470618132
Publisher: For Dummies
Published: 2010-07-06T00:00:00+00:00

If all actions are completed according to the bar chart, the third milestone will be reached on June 1. If some actions take longer to complete than estimated, you may not reach the milestone on time and someone may end up in hot water. Conversely, if some actions take less time than estimated, the milestone can be reached early (sounds like a bonus is in order!).

The advantages of the Gantt chart are its simplicity, ease of preparation and use, and low cost. Although Gantt charts work fine for a simple project such as preparing a budget, they’re generally unsuitable for large, complex projects such as building a space shuttle or doing your taxes.

Flowcharts

When the going gets tough, the tough get going — and they reach for their flowcharts. Although bar charts are useful for simple projects, they don’t illustrate the sequential flow of actions in a project (and, therefore, aren’t as 15_618134-ch10.indd 172

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Chapter 10: Monitoring Performance and Execution

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useful for complex projects). On the other hand, flowcharts do a good job of illustrating this sequential flow. Although flowcharts look completely different than bar charts, they also have three key elements:

✓

Actions: In the case of flowcharts, arrows indicate actions. Arrows lead from one event to the next on a flowchart until the project is completed.

The length of the arrows doesn’t necessarily indicate the duration of an action. The arrows’ primary purpose in a flow chart is to illustrate the sequential relationship of actions to one another.

✓

Events: Events, represented in flowcharts by numbered circles, signify the completion of a particular action.

✓

Time: Time estimates are inserted alongside each action (arrow) in the flowchart. By adding the number of time units along a particular path, you can estimate the total time for the completion of an action.

Figure 10-2 shows a flowchart of the corporate budgeting example illustrated in Figure 10-1. As you can see, the flowchart shows exactly how each action relates to the others. By following the longest path in terms of time, you can determine the critical path of the project. This kind of analysis is called the critical path method (CPM) and assumes that the time to complete individual actions can be estimated with a high degree of certainty. The CPM highlights the actions that determine the soonest that a project can be completed — in this case, 30 days.

Third Milestone: Submit Draft Budget

Review

prior-year

reports

Create draft

Review draft

Submit

Figure 10-2:

Meet with staff

budget

budget

draft

A flowchart

15 days

5 days

5 days

budget

Review current

Review

for the

year-to-date

personnel

5 days

10 days

corporate

reports

status

budgeting

example.

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